Comment by gdb | Hacker News Reader

Comment by gdb | Hacker News Reader

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The Stellar Foundation will actually control relatively little. The creation of new stellars, for example, will be done in a fully distributed fashion: https://www.stellar.org/about/mandate/#Stellar_creation.

To clarify, of the total 5% reserved for operations, ownership is currently:

- 2% to Stripe (the majority of which we're going to auction off to other companies, with net profits being returned to the foundation) - 2.5% to employees (https://www.stellar.org/about/governance/#Employee_Compensat...), vesting over four years

As needed, the organization will also hold open auctions to raise funds from its remaining pool of stellars (https://www.stellar.org/about/mandate/#Continued_funding_of_...), which will conveniently distribute the stellars further.

Note also there's a five-year lockup for the founders: https://www.stellar.org/about/mandate/#Stellar_distribution.

Are there actions you're worried that the organization might be able to take given this?

Thanks for sharing the details. My core problem isn't with the details, mainly because I haven't gone through it or even what percentage of Stellar is controlled by the organization. My problem is with the basis of having such a self-selected organization which seems to have given itself the de facto control over the flow of the monetary system.

As a good example what you mentioned: "As needed, the organization will also hold open auctions to raise funds from its remaining pool of stellars".

This is a huge thing! Who decides when "as needed" is? If it's the board, what's the basis of their authority? Just being a non=profit doesn't stop one or more of the board members to act in self-interest.

>The Stellar Foundation will actually control relatively little. The creation of new stellars, for example, will be done in a fully distributed fashion

It's not fully distributed. All the decision-making nodes are controlled by Stellar. Just because there is stake-based voting involved does not mean the underlying system is distributed.

Maybe I'm misunderstanding your objection, but you can actually run your own stellard, which is a first-class member of the network: https://github.com/stellar/stellard. The Foundation runs a public stellard for convenience, but you're under no obligation to use it. The client and wallet powering launch.stellar.org are similarly open-source, and can be hooked up to your local stellard.

Stellar is a fork of Ripple. It is not a decentralized system, in the sense that, if you want to use any given currency (such as stellars), you must trust a number of centralized, trusted nodes. This is Ripple's/Stellar's "solution" to the double-spend problem.

Here's a related (though not completely equivalent) thread on Reddit that I think does a good job of framing this topic: http://www.reddit.com/r/Bitcoin/comments/2c910w/stripe_gets_....

Specifically, "Apart from that, block signers synchronize through the Consensus algorithm which is a semi-trusted model."

Emphasis on "semi-trusted", i.e. "not worth shit from a decentralization standpoint".

That thread understates just how centralized the consensus system is. If your node isn't on the trust list of the official Stellar Foundation nodes, they do not participate in the consensus-building process of those nodes and cannot affect their consensus. Those official nodes have the ability to freeze accounts, change the fees charged, and probably to issue new money arbitrarily if they collude.

Now, technically your node can have a different trust list and come to a different consensus. You don't want to do that, though, because then you're stuck on a different version of the transaction history from the one everyone else accepts and any money you receive is likely worthless because it's not recognised by the rest of the network.

How is that worse than trusting that the top 2 BTC mining pools aren't colliding?

I'll take a semi-centralized system with respected public figures as advisors over a theoretically decentralized system that is actually ran by a few anonymous miners.

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